Why Does the National Debt Keep Increasing?

This is my experience as well and one reason I posted what I did up at the start of the thread. My parents let us get pizza on Sundays, and we went out to eat or ice cream maybe once a month. Movies not often, a handful. We didn’t have cable. We had great reliable cars that weren’t new (at least until I was almost done with HS). Cheap cell phone, late to the cell phone arena, and basically to keep track of us. I was responsible as a kid for overbilled amounts above our “minute” allotment.

Obviously there are inequalities that we need to fix, and I believe PP needs to increase significantly, but I stated that above as well. Some part of this is individual driven. Just look at the list I posted. What could you do with $1000 extra bucks a month?

Well my $1000 would probably be invested. A newer used car is in this for the wife as she is in a 05 focus nearing 200k miles. We would probably get her up to max 401k, and a newer car.

I’m not sure though as taxes would probably go up for us perhaps making it a wash.

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Only if they see the money lol. But seriously I do think 401k can be invisible depending on how you have it set up

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That is a very possible impact (people upping 401k). Maxing 401k has been my number 1 action to lower my taxes.

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We’re in the late stages of the long-term debt cycle. Demand dropped due to COVID. To offset this, the Federal Reserve ramped up financial asset purchases to support financial markets, and the Federal Government added stimulus on top to support the “real” economy. We’ve been headed in this direction, but COVID accelerated the process.

Check out the Fed’s balance sheet to see how far gone we are. The value of assets they hold is about 1/3 US annual GDP.

There’s been some nominal talk about raising taxes, but let’s be clear - we’re in the inflation stage now. The Haves are going to hurt because the real value of their wealth is going to decrease. The Have Nots are going to hurt because the cost of the things they need to survive is going to go up.

There’s nothing new under the sun. The economic cycle has been repeating for as long as there’s been an economy. Anyone who’s interested should watch this. Things are playing out exactly as they’re “supposed” to.

A separate topic that gets conflated with inflation is wage deflation. The share of GDP going to workers in the form of wages has been going down for decades while a larger and larger share is staying with capital holders. That’s why your grandfather could support a family of 4 on a blue collar salary in 1950, and you can’t now.

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Quite true, I didn’t want to get into that area of discussion lol

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Understandable. That discussion can turn political real quick, which isn’t what I want. I’m not making a value judgement either way. As both a wage earner and a capital owner (shareholder), I’m pretty ambivalent myself. I think it’s human nature for those with leverage to squeeze the other side until it becomes untenable to do so. Then… Vive la révolution.

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Yeah, I would say that encapsulates history pretty well. I don’t think deliberately squeezing the other half of the equation ad nauseum is good, but I also recognize that people with leverage have an easier time building more leverage (and money). And that’s not immoral. It’s just math.

As a wage earner and capital owner myself (shareholder), I realized early on that being the latter is much much better. It is worth making sacrifices to become a holder of significant capital of the type that makes money for itself.

I don’t happen to agree with this. I think it is based on greed that says l will tear down my overflowing storehouses and build bigger ones (typically with labor that is underpaid). Hehe jumped right into the political, albeit from a religious position.

I am merely stating my belief, and dont wish to argue the point since l also have some accumulations and have not exactly given all to the poor.

@kjm l bookmarked that economics link. Its looking very interesting, but wifey was talkative this am. I will read it later, while she is stimulating the economy for some low tech goods - produced by near slave producers in a foreign land.

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For the record, today’s (low or non) wage workers do live far beyond their means, causing some of their own long term accumulation issue.

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I go back and forth on this. I do agree to an extent - that parable was there for a reason and is still VERY much relevant today (perhaps more so?).

I was speaking more along the lines of passive income - i.e. the law of compound interest - and not the mindset of greed. We are called to be good stewards, and there is also the parable of the good servants making profit for their master (who is not conveyed as immoral for pursuing investments).

But there’s a difference between responsibility towards ones family and avarice. Both can use the same financial vehicles however.

Be careful with blanket statements of that type

What are you - a 5th grader?
:joy:

Eh??

Isnt that what you were called in covid thread?

I believe it was, or something like that lol. I must confess I don’t quite follow the joke sadly. Long travel day

I have posted for years that workers are worth their wage (and more of it, even when doing menial job). But like your and mnben posts, l was modeled to buy what you could afford, when you could afford it. Not buying $5 cups latte or new car every 3 years, etc. Some live that way on the dole, which is maddening.

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I would argue he should be conveyed as immoral. He commands the third servant to be cast into darkness and implies that his punishment will be horrible (weeping and gnashing of teeth). All for not returning a profit. Maybe just fire the guy, or have him do menial tasks.

Maybe this parable is trying to make some other point (to be a good and faithful servant perhaps), and ignores the actions of the master? I think anyone in current day doing what the master does in the story would be seen as immoral.

Inherently, workers are on average worth more than their wage, or it wouldn’t be a good deal for employers to hire them at their wage. The larger the difference in leverage between the employer and employee, the larger the difference between wage and work value. I believe the US economy is in a state in which a few have a lot of leverage (capital), and many have almost no leverage. Doing what one can to have leverage is very smart IMO if one can do so.

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The parable of the talents is actually about using ‘gifts’ for a spiritual outcome (and they all are).

I have no issue with capital, it is wise to accumulate some to be self sufficient and charitable. But excess consolidation of it, alwwys ends up as a negative.

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